Indian ITeS Companies Sniff Opportunities as U.S. Govt Cuts Budget
Date: Wednesday , March 02, 2011
Indian IT Service firms might just be in for a merry ride as the U.S. government has decided to cut more than $61 billion from their current spending levels. This will prove to be a blessing for the service firms who are pushing hard to be a part of the $100-billion U.S. government outsourcing market. More government sector contracts will be outsourced to Indian firms as the U.S. states are looking at gaining greater efficiencies by reducing costs.
Healthcare service companies are largely to gain, as the U.S. government has mandated that all healthcare records needs to be archived digitally. Companies like TCS and Wipro, who have a nine year $407-million outsourcing contract from the state of Missouri for delivering healthcare-related IT services, might be the companies bagging the most number of contracts. Other areas that the companies could look forward to are the departments of justice, transportation, homeland security, health and human services, commerce, energy, agriculture, and treasury.
However, experts are not very optimistic of Indian firms getting these new government contracts as outsourcing is a sensitive subject for the U.S. government due to the rise in unemployment rate. The political cost for the government cutting jobs can be catastrophic. Eventhough the cut in spending in the proposed budget is opening way for outsourcing, the governments will try everything in their power to avoid this and to make sure most of the work is done onshore thus reducing the political damage.